Baltimore officials are creating a new development district to help fund construction of the city's next major waterfront community, the $1 billion Harbor Point project, using a process known as tax increment financing.
Baltimore's Planning Commission voted Thursday to approve a City Council bill that delineates boundaries for a 26-acre parcel in which roads, sewers and other public infrastructure would be built with tax increment financing, or TIF, funds.
Creation of the district is the first step in the legal process of designating Harbor Point as a location where tax increment financing can be used to prepare land for privately funded development. The parcel, controlled by John Paterakis' Harbor East Development Group, is the former Allied Signal chromium plant property between Fells Point and Harbor East.
The developer plans to build about $800 million worth of housing, offices and other improvements over the next 15 years to complement the Harbor East community and the $100 million Thames Street Wharf office building that opened at Harbor Point last spring. The Harbor Point legislation must be approved by the full council before the district designation can take effect.
M.J. "Jay" Brodie, president of the Baltimore Development Corp., told commission members that Harbor Point is a "world-class site" but needs roads, sewers and other infrastructure for its potential to be realized. He said the TIF plan would enable developers to sell bonds to raise money for the infrastructure work; they could then use property tax revenue generated by completed developments to pay the debt service on the bonds.
Brodie said the construction of Harbor Point would provide much-needed jobs and development. "This is an investment in the future," he said.
If authorized, Harbor Point would be the 10th TIF district approved in Baltimore since the late 1990s. City officials have estimated in the past that infrastructure improvements at Harbor Point could cost $155 million, but Brodie said the city does not have a firm figure for the work and the council bill does not specify an amount. Brodie said additional council bills authorizing the Harbor Point TIF plan would be introduced next year and that more details would be available then.